Buoyant activity in Britain's manufacturing sector came to an unexpected halt in July as factory output suffered the first fall in five months, government figures showed yesterday. However, statisticians said that the recovery was still on track.

Office for National Statistics data showed a 0.3% drop in production, confounding City expectations following a recent upward trend and robust surveys from employers' groups. July's fall, which ended the longest spell of rising output in manufacturing for eight years, was driven by lower production of ships and aircraft.

But the ONS said that the monthly drop reflected volatility in the data rather than a fundamental downturn.